HMLP or KEX: Which Is the Better Value Stock Right Now?
Investors looking for stocks in the Transportation - Shipping sector might want to consider either Hoegh LNG (HMLP) or Kirby (KEX). But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Hoegh LNG has a Zacks Rank of #2 (Buy), while Kirby has a Zacks Rank of #4 (Sell) right now. This means that HMLP's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one piece of the puzzle for value investors.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its current share price levels.
Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.
HMLP currently has a forward P/E ratio of 3.16, while KEX has a forward P/E of 88.29. We also note that HMLP has a PEG ratio of 0.50. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. KEX currently has a PEG ratio of 7.36.
Another notable valuation metric for HMLP is its P/B ratio of 0.52. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, KEX has a P/B of 1.08.
Based on these metrics and many more, HMLP holds a Value grade of A, while KEX has a Value grade of C.
HMLP stands above KEX thanks to its solid earnings outlook, and based on these valuation figures, we also feel that HMLP is the superior value option right now.
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Hoegh LNG Partners LP (HMLP) : Free Stock Analysis Report
Kirby Corporation (KEX) : Free Stock Analysis Report
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